I'd rather see compilations with maybe re-mastered textures, up resolution to highest possible, and where possible wide-screen. For the most part though i'd settle for all PS1/PS2 games eventually getting released on PSN.
Dev time for PS3 games should be spent on series reboots/sequels rather than remaking old games. And I hate to say this, but I think a FFVII remake wouldn't necessarily be all that worth it. They just need to make a FF game that feels as epic. FFVI and FFVII were truly epic stories, that havn't really been matched in the series yet. That's the primary reason for wanting a remake in current graphics glory. If they make a FF that surpassed that epicness we wouldn't need a remake.